The continuing operation of any retail store requires that you perform routine inventory counts to identify buying trends, account for shrink and keep the sales floor and stockroom organized. However, if your business deals with consumables, this can be more challenging from an accounting standpoint. Proper inventory will ensure that your store is only providing the freshest products for its customers.

Choosing a Time

For retail locations that are not open 24 hours a day, the best time to conduct inventory is when the store is closed. Stores open around the clock may consider closing for a few hours early in the morning or late at night to ensure accurate counts. If a store must remain open, inventory should be conducted overnight when customer traffic is at a minimum. Afterward, all point of sale, or POS, transactions will have to be leveraged to ensure accurate counts.

Using the POS System for Comparison

To begin the inventory, all employees participating in the count will need a list printed out from the POS system of the current on-hand counts of every consumable in the store. Associates will need to systematically count all of the food items aisle by aisle on the sales floor and then do the same in the stockroom. To keep things organized, certain associates should be assigned to a single product line, aisle or area of the stockroom. Every designated area should have printed tags taped to each shelf or section. As employees perform their inventory count, they should first tally their totals next to the POS system’s on-hand numbers for comparison and then write the same tally on the corresponding aisle tag, signifying that the area has been counted.

Accounting for Expiration Dates

Food inventory always presents an extra complication because each product has an expiration date to be verified. In addition to physically counting the number of each consumable item and comparing it to what is on hand in the POS system, every expiration date must be examined to ensure the food is still edible and can legally be sold. Any expired food must be immediately separated from viable items on the sales floor and stock areas to be discarded. When adjusting counts in the POS system, it is common practice to make separate notes for the expired quantity of each consumable item as this will help employees in charge of ordering adjust how much inventory they are buying.

Perishables

While many perishables such as fruits and vegetables do not have expiration dates, they should still be examined for quality control during inventory. For instance, if an associate counts 50 oranges, but 20 are visibly rotten, the bad fruit should be set aside and noted as such just as if it was expired. Adjusting counts allows the store's buyers to identify trends, such as whether a supplier is sending larger than normal quantities of rotten or rotting perishables to the store.

Frozen Foods

Of all the consumables that must be inventoried, those that are frozen provide the greatest challenge, because in many cases freezer doors will have to be propped opened and food may have to be removed to count it accurately. If the inventory count takes too long, the foods can begin to thaw, forcing employees to discard the entire lot. To prevent this, frozen goods should be inventoried all at once by a large enough team of associates to work through each item quickly.

Second Counts

After the inventory has been completed, random sections should be selected for a second count to ensure quality control. Second counts should be conducted by a different associate, and any discrepancies should be noted. If too many second counts are off, the inventory process may be started again from scratch at the store manager’s discretion.

About the Author

Based in Interlaken, N.Y., James Rosado has been writing articles on business, finance and marketing since 2009. His articles have appeared in regional publications across the Finger Lakes region of New York including the "Ithaca Times." He holds a Bachelor's of Arts in visual communication and an Associates of Arts in hospitality marketing.